Outsourcing industrial wastewater treatment
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OUTSOURCING INDUSTRIAL WASTEWATER TREATMENT . Jerzy Kołłajtis – [email protected] Magda Trybuch – [email protected] (+48 22) 833 09 36 Bytomska 5A, 01-612 Warszawa ADVENT-ENVIRON www.environcorp.com www.advent-environ.com. WHAT IS OUTSOURCING?. Replaces existing in-house function

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OUTSOURCING INDUSTRIAL WASTEWATER TREATMENT

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Outsourcing industrial wastewater treatment

OUTSOURCING INDUSTRIAL WASTEWATER TREATMENT

Jerzy Kołłajtis – [email protected]

Magda Trybuch – [email protected]

(+48 22) 833 09 36

Bytomska 5A, 01-612 Warszawa

ADVENT-ENVIRON

www.environcorp.com

www.advent-environ.com


What is outsourcing

WHAT IS OUTSOURCING?

  • Replaces existing in-house function

  • Contractor will reduce industry costs

  • May provide better service

  • Contractual arrangements are key

  • Established in municipal market

  • Growing trend in industrial market


What can be outsourced

WHAT CAN BE OUTSOURCED?

  • Staff

  • Services

  • Programs

  • Utilities (water, power, wastewater treatment, waste disposal)

  • Equipment (i.e. leasing)

  • All of the above


Outsourcing industrial wastewater treatment

DEGREES OF OUTSOURCING

Process & Detailed Design Engineering & Construction

  • Traditional contract engineering services

  • Applicable to new plant or upgrades

  • Ensures smooth transition to client control

  • Can help safeguard warranties

Startup Support & Operator Training

Troubleshooting

Problems

  • Emergency response

  • Not cost-effective if it becomes routine

Technical

Support

  • Identify and avoid/reduce problems

  • Ranges from data review to operator direction

  • Manpower service

  • Client management remains in place

Operations

Labor

Contract

Management

  • Assume control of all labor, budget, reporting

  • Establish performance criteria

Purchase Assets, i.e Own/Operate

  • Can transfer more risk to operator

  • Detailed contracts needed to address risk


Reasons to outsource

REASONS TO OUTSOURCE

  • Go to your core competencies

  • Redirect management time

  • Reduce operating costs

  • Better performance

  • Capital upgrades can be annualized

  • Selling assets improves bottom line


Potential problems

POTENTIAL PROBLEMS

  • Perceived loss of control

  • Resistance from in-house staff

  • Define performance specifications?

  • Upfront additional effort

  • Transfer of staff to contractor

  • Contract can reduce flexibility


What about compliance

WHAT ABOUT COMPLIANCE?

  • Industry “must control” this

  • Contractor image versus yours

  • Responsibility for any violations?

  • Who is the permit owner/operator?

  • Contractor has core competency

  • More outside resources available


Outsourcing industrial wastewater treatment

PATH TO OUTSOURCING

Determination of Need

  • Clearly define corporate or site driving force

  • Get preliminary buy-in from stakeholders

  • What is the upper & lower limit for contractor scope

  • Identify qualified contractors

Decide on How to Implement

Due Diligence

  • Open book or bid package

  • Prepare responses to bidder questions

Business Proposal

  • Range on bids is proportional to info provided

  • Normalize bids based on your priorities

  • Scope is firmed up for contracting stage

  • Confirm handling of development costs

Confirm Final Scope

Negotiate Contract

  • Formalize the risk/reward equation

  • Very time consuming

Transition to Provider

  • Provide qualified client liaison person

  • Contractor “A-team” onsite for short term


Treatment plant budget

TREATMENT PLANT BUDGET


Contracts

CONTRACTS

  • Payment terms

  • Establishing performance criteria

  • Extent of liabilities

  • Share risk & savings

  • Cost of termination

  • Can lock out creativity


Summary of outsourcing

SUMMARY OF OUTSOURCING

  • Focus on core competencies

  • Lower operational costs

  • Annualize future capital costs

  • Contract is key

  • Can increase industry overall control

  • Needs commitment from all

  • Assess contractor performance


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